#31
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Re: how hard is it to become wealthy?
[ QUOTE ]
How come more people aren't retiring at 40? [/ QUOTE ] Look no further than the responses in this thread claiming that 150k/year is not wealthy. A lot of people are just stupid with money. When they start making a lot of it, they just spend it faster on completely unnecessary things. I don't care where you live, 150k/year is pretty [censored] wealthy and you have no one but yourself to blame if you don't enjoy an early retirement. |
#32
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Re: how hard is it to become wealthy?
cool, thanks!
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#33
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Re: how hard is it to become wealthy?
I think you naive. It is not easy to become wealthy. It can be done, but most people will not get there by age 40.
The best bet is entrepeneurship. |
#34
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Re: how hard is it to become wealthy?
Al,
At $150k you quite likely didn't feel well-off because you adjusted your consumption to match your peers and income level. I know a number of people in NYC who make $500k+ who feel like they can barely make ends meet and don't save anything. Seems crazy, but it's true. People who make far less than $150k in the Bay Area do very well by not buying new A4s, not making frequent trips to Tahoe, not eating out a ton, not going to tons of bars, not buying $200 shoes, not getting $50 salon haircuts, and not blowing a ton in rent. They early on buy a so-so house and still manage to save more than people making twice what they earn. And they do this without sacrificing any fun, they are just smarter about allocating their fun dollars, doing things like organizing cool house parties instead of heading out to six bars. Fast-forward ten years and these people are on their third house, maybe have a rental property or two, and have saved up way more than the people who are still making a bigger salary than them. This is all a longer-winded way of saying what haak said. Books like The Overspent American are very interesting wrt some of this stuff. As far as OP's q, I think it is very easy to become wealthy if you early on in life focus on the long-term at the cost of some short-term sacrifices. This has to do with people who have the advantages of education, opportunity, etc, which I believe most people here generally fit into. The better off you hit the ground running, the easier it is to become wealthy, of course. Edit: Just re-read OP. I think it is much tougher to get there by 40 unless you are really focused on some entrepreneurial type stuff, whether that be starting your own company or really aggressively getting into things like real estate on the side. |
#35
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Re: how hard is it to become wealthy?
[ QUOTE ]
[ QUOTE ] That's where poker comes in, gorie :0) I realize that it isn't easy for the general populace to save $5k/yr, but for somebody who plays poker on the side, it certainly should be. [/ QUOTE ] ...and if not, well you're at least making it easier for the rest of us to do it. [img]/images/graemlins/grin.gif[/img] [/ QUOTE ] so now i'm being told it should not only be easy for me to become wealthy but also easy for me to be winning at poker ! [img]/images/graemlins/frown.gif[/img] ! way to make me feel worse, jerks !! [img]/images/graemlins/tongue.gif[/img] anyway i guess i just don't see how it is as easy as a lot of you seem to think. and to people making 150k a year and not thinking they're very well off try living on 20k a year for awhile ? i understand it is different depending on where you live but not by that much, it still sounds like a lot to me. |
#36
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Re: how hard is it to become wealthy?
How is $150,000 a year not wealthy for a single person? Say you take home $90,000 after taxes. In NY or SF, drop $2000 a month on rent, $1000 on food, that leaves you with $54000 to spend on stuff. If you invest half of that at 10% for 30 years, you have $4 million. And $2000 a month in discretionary spending. That's pretty damn comfortable.
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#37
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Re: how hard is it to become wealthy?
[ QUOTE ]
[ QUOTE ] How come more people aren't retiring at 40? [/ QUOTE ] Look no further than the responses in this thread claiming that 150k/year is not wealthy. A lot of people are just stupid with money. When they start making a lot of it, they just spend it faster on completely unnecessary things. I don't care where you live, 150k/year is pretty [censored] wealthy and you have no one but yourself to blame if you don't enjoy an early retirement. [/ QUOTE ] $150k/year is $12.5k/month. After taxes, you have $8 to $9k/month. If you live in the Bay Area or NY and want to buy a house, thats $4k/month. If you make $150k, you almost certainly have student loans. That could be as much as $1k/month. You need a car (2 if you have a family), so that's another $1k/month. You probably want to save also. All of a sudden, you have $2k/month (or less) to spend. Obviously, $2k/month is not poor by any stretch of the imagination. But that's not my definition of wealthy, either. Someone with that much discretionary income can't just take any vacation, they have to save for it. They can't just buy a big screen TV or a new computer. They have to budget for it. That's what I mean when I say their not wealthy--they still need to watch what they spend. Someone truly wealthy (movie stars, atheletes, etc.) don't care about money and can drop $2k on a night out without thought. |
#38
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Re: how hard is it to become wealthy?
assuming you invest at the beginning of the year, you'd have $863,507 at the end of the year when you're 50.
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#39
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Re: how hard is it to become wealthy?
[ QUOTE ]
Al, At $150k you quite likely didn't feel well-off because you adjusted your consumption to match your peers and income level. I know a number of people in NYC who make $500k+ who feel like they can barely make ends meet and don't save anything. Seems crazy, but it's true. People who make far less than $150k in the Bay Area do very well by not buying new A4s, not making frequent trips to Tahoe, not eating out a ton, not going to tons of bars, not buying $200 shoes, not getting $50 salon haircuts, and not blowing a ton in rent. [/ QUOTE ] El Diablo / Haakee - yes, I know very much the type of person you're describing. But outside of blowing a disproportionate amount of $ on rent while I was in SF, the above doesn't really fairly describe me. Dude, I'm Asian, I'm cheap. I could've saved more $, but I saved a decent amount. My definition of "well off" is a little closer to "wealthy" than maybe other people's in this thread. And it's possible because my peer group in SF was making a ridiculous amount of $, my own sense of "being comfortable" is skewed. But fro my understanding, in very expensive cities like SF and NY (even LA to an extent), when you factor in eventually having a family and kids, $150k / year I don't think gets you that far. Not into the "well off" category as defined in my mind. -Al |
#40
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Re: how hard is it to become wealthy?
[ QUOTE ]
It's all relative. If you're married, 3 kids, a wife who doesn't work, and you're pulling down $150k, that's not wealthy. [/ QUOTE ] You're living in the wrong places then man. Check that, thought you said well-off. OOPS!! |
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